ST Query

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

16 September 2010 Whether air travel Agent taken composition scheme of paying .6% & 1.2 % respectively can take input credit.
On what services it can take input credit???

Aditya Maheshwari

Aditya Maheshwari (Expert)
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16 September 2010 It is a composite rate and hence no input credit can be taken for payment of the same.

VINOD ARORA

VINOD ARORA (Expert)
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16 September 2010 In case of some services e.g. Air Travel agent, catering services, mandap keeper services and construction services, service tax is payable at lower rates, i.e. partial abatement is available from gross value, vide 1/2006-ST dated 1-3-2006.

The lower rate is applicable if the service provider does not avail Cenvat credit of duty/tax on inputs, input services and capital goods. Till 28-2-2006, he was entitled to avail Cenvat credit on input services. W.e.f. 1-3-2006, he cannot avail any Cenvat credit, if he avails the partial abatement.

Option to pay service tax at flat rate on ‘basic fare’ @ 0.6% in case of domestic booking and 1.2% in case of international booking [rule 6(7) of Cenvat Credit Rules] is covered under partial abatement, so no input credit is allowed in those cases.

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Querist : Anonymous

Querist : Anonymous (Querist)

16 September 2010 What in case Service Provider is giving services of Air Travel agent as well other service such as event mgmt.
Further in case Travel agent is only broking between Event management Service Provider & Client,if it requires to pay ST as Event magmt company already charges ST